Since Part 1 shouldn't be active for you, the software is likely "tripping" over a specific entry. Here is how to troubleshoot and force the correction:
- Check the "Form 8801 Worksheet" in Forms Mode: If you are using the Desktop version (Windows/Mac), switch to Forms Mode (click the "Forms" icon in the top right). Open the Form 8801 Worksheet. Look for any highlighted or manually entered values in the Part 1 section. If they are there, try to trace the "source" (usually by right-clicking and selecting "Data Source").
- Review Prior Year "Exclusion" Entries: The AMT credit is split into Exclusion items (which are lost forever) and Deferral items (which create the credit). If you had items like tax-exempt interest from private activity bonds or a large standard deduction in the prior year, TurboTax might be misclassifying them.
- Delete and Re-import the Form: Sometimes the "carryforward" lfrom the previous year's file gets corrupted.
- Go to the forms mode.
- Delete Form 8801 and the AMT Credit Carryover Worksheet.
- Go back into the "Federal" interview section and re-enter your 2024 AMT information manually.
If you received a K-1, check the AMT section (Box 17 for 1065 or Box 15 for 1120-S). If an "Exclusion" code was used there, TurboTax might be populating Part 1 erroneously.
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